'We're now in line with the height of the 2009 global financial crisis, and the onset of COVID-19'
Business confidence in central New Zealand has plunged to record low, according to a new report, which attributed it to the staffing crisis faced by organisations. The latest Central New Zealand Business Confidence Survey revealed that the expectation of the economy is at a net negative of -61.90%.
Simon Arcus, chief executive of Business Central and the Wellington Chamber of Commerce, said this is the lowest reported by their group since they started recording.
"Confidence is at the lowest it's been in our 16 years of data," said Arcus in a statement. "We're now in line with the height of the 2009 global financial crisis, and the onset of COVID-19."
They survey was carried out among 220 businesses across the Central New Zealand region, from Gisborne to Nelson.
And according to 62% of the businesses, staffing is the main barrier to businesses, with 86% adding it was harder to find skilled staff this time than last year. This struggle with staffing is driving the spiral in business confidence in the region, according to the report.
"Even those businesses that do report they are doing well feel that a lack of staff means a drag on their growth. That's a handbrake on the prosperity that could be delivered back to New Zealand," said Arcus.
Read more: 40% of employers struggling to recruit 'good people'
In addition, the survey also found that businesses are also concerned about rising costs. For the first time, businesses are also concerned about interest rates, with access to finance appearing for the first time as a major barrier to doing business.
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The report came as inflation hits 7.3% in New Zealand, the highest recorded in the country since 1990.
"Global factors such as the ongoing impacts of the pandemic on supply chains and the war in Ukraine are affecting prices, particularly those for fuel and building materials, and this means demand is not being met, and having a sizeable effect on New Zealand households and businesses," said Finance Minister Grant Robertson in a statement.
"We recognise that this is a tough time for New Zealanders and the rise in the cost of living is making it hard for many. We have taken steps to ease some of that pressure on households, particularly those on lower incomes."